The former chief strategist to the US president says Australia is on the "front line" in a clash with China, which is set to intensify over the South China Sea, according to a report.
Steve Bannon, the controversial former chief strategist to US President Donald Trump, believes Australia is in a "fight for the ages" that would decide whether western nations can ensure their sovereignty against intrusion by China.
In a report by The Sydney Morning Herald, the chief of Mr Trump's victorious 2016 election campaign said Australia was "at the forefront of the geopolitical contest of our time" and the events playing out were "more important than what's happening in the US and other places".
Mr Bannon, who was sacked by the US president in January after criticising the Trump family, warned that if things continued along the current path, China would "control all of the countries of South East Asia and they will control Australia".
Mr Bannon said the Australian government "finally woke up" to China's "investment into politics" by introducing foreign interference laws, and cited the events as an "object lesson in what to avoid".
"And you (Australia) wake up and you say, 'hold on - who controls our economic base', because doesn't politics ultimately come off who controls the economic base?" Bannon said.
"Because of Australia's example, it will not happen here in the US.
"It will not be allowed to happen. People are woke."
Mr Bannon called Australia the "San Andreas fault between China and the West".
"These are the two great systems that have built up over 2000 years. You are the representative of Athens and the democratic Western tradition, and China is a Confucian totalitarian system," he said.
"The South China Sea is very quickly going to become the front line. The South China Sea will be the focus of an intense global crisis."
Mr Bannon cited China's economic advances on Australia as the factor that persuaded the Trump administration to respond to Beijing through recent tariffs.
Punishing US tariffs on Chinese imports took effect early Friday, marking the start of President Trump's trade war with the largest US trading partner.
Beijing said it was "forced to take necessary countermeasures" after Trump imposed 25 percent duties on about $34 billion in Chinese machinery, electronics and high-tech equipment including autos, computer hard drives and LEDs.
China's commerce ministry accused the US of violating World Trade Organisation rules by launching the "largest trade war in economic history to date".
Mr Bannon embraced news of the tariff, saying, "I can't emphasise Friday night enough - it was the day that President Trump stood up for the American worker".